24 Independent Power Companies To Produce Electricity

Published: 2016 June 13 09:25:10 (1691 Views)

THE Zimbabwe Energy Regulatory Authority (Zera) has so far licensed 24 Independent Power Producers despite the fact that most of the projects are being undermined by the shortage of funds and lack of clear policies in the energy sector. Zera chief executive officer Gloria Magombo said among all the registered IPP programme only 10 are producing electricity to the national grid at low capacity.

“We’ve licensed about 24 power projects to date under the Independent Power Producers programme of the 24 projects we’ve got 10 projects, which are operational.

“Our market has got very serious liquidity issues and for most of the power projects to move from prefeasibility to bankable feasibility they need access to funding for project preparation,” she said.

She added that there is need to come up with an integrated energy resources plan and after its development will come up with competitive procurement framework for IPP.

“We believe that as a country we need to move from the current unsolicited bids, which tend to be expensive because we don’t have control of those bids and there is no competition.

“Once we’ve finalised the integrated energy resources plan we should be able to come up with a competitive bidding process for procurement of additional capacity going forward, which will be based on list costs of the economy,” she said.

This was said during a workshop organised by the Ministry of Macro-Economic Planning and Investment Promotion in collaboration with the United Nations Development Programme (UNDP) to gather macroeconomic policies in order to grow the economy as well as guiding the budgetary process.

“Among the IPPs we’re looking at the coal generators Tongaat Hullet project in Triangle and sugar mill producing power mainly for own consumption with Hippo Valley being able to add an additional of 4 or 6 megawatts when they’ve surplus to the grid.

“We also have green fuel which is producing 18,3 megawatts and supplies 5 megawatts when it has excess and we’ve five generators mainly small hydro now with the capacity of 24 megawatts which are mainly in the Honde Valley area,” she said.

She also said Zera is set to license a number of small solar projects apart from the ZPC once which can produce 5 to 25 megawatts contributing a total of 300 megawatts.

“There’s need for clarity on the policies and laws of indigenisation applicable to the energy sector which is an area where they’re consistently having questions.

“People are saying it’s not about the policy but they want to see clear policies on paper which they can use in their operations,” she said.

She added that there should be a clear pricing policy of energy which will reflects the cost of production and if there is need to subsidies because there are certain sectors, which needs to be subsidies there should also be a clear subsidy indicating where that subsidy is coming from.

The IPPs are also raising the issue that there is need to strengthen ZETDC as an off taker in terms of its credit worthiness to be improved. –BH24.